Iraq telecom regulator scraps $100mn fine against Zain

Zain Iraq’s Q1 profit was $34mn, down from $78mn a year earlier, a drop the company blamed on political turmoil

Reuters/DubaiIraq’s telecoms watchdog has scrapped a $100mn fine imposed on the country’s largest mobile phone operator, Zain Iraq, Kuwaiti parent firm Zain said yesterday, ending a case that had dragged on for several years. In 2011, the Communication and Media Commission (CMC) claimed Zain Iraq, which will list on the Iraq Stock Exchange on June 23, had sold mobile phone SIM cards without its permission. The CMC issued the fine and claimed a further $162mn as its portion of revenue from the mobile accounts in question. A series of judgements and counter-judgements dragged on for several years, but a CMC committee considering the case has decided not to impose the fine, Zain said in a statement to Kuwait’s bourse. This decision is final, Zain said. CMC withdrew its claim for $162mn in April, Zain told Reuters separately. Iraq accounted for 29% of customers and 33% of Zain’s revenue in the first quarter. Zain Iraq’s first-quarter profit was $34mn, down from $78mn a year earlier, a drop the company blamed on political turmoil that has displaced millions of Iraqis, caused temporary network shutdowns and raised operational costs, plus stiffer competition and forex fluctuations.